Views sought on rents

The Board of Castle Rock Edinvar has agreed that the level of rent increase from April 2017 will be 2%, based on the rate of inflation (RPI) in September 2016.


In 2015 where we asked customers what they thought about rent increases for a further three years at RPI +1%. You told us this was too high so we agreed to set the level of rent increase at RPI only in 2016/17 (1%) and 2017/18 (2%).

Priorities and Commitments 

The demand on the business to meet our existing commitments as well as new statutory requirements is very high:

  • Energy Efficiency Standard for Social Housing (EESH): This is a requirement on landlords to make our properties more energy efficient by 2020. EESH sets minimum energy ratings for different types of property and we estimate that £6 million will be needed over 5 years to meet this target.
  • Repairs: Major repairs, planned and routine maintenance in our homes accounts for 39p in every £1 of rental income.
  • New Homes: It is a Scottish Government priority to build 50,000 new homes by March 2021. We are playing a key role in helping to meet this ambition by planning to build 555 social rented houses by March 2020. Although we will receive grants we also have to borrow money and invest our own funds for new building. Reinvestment in new homes accounts for 23p in every £1 of rental income.
  • Repayment of Debt: The cost of borrowing, although low at present, is forecast to rise.
  • Financial Strength: In order to obtain favourable rates for borrowing money to build new properties, we need to be financially strong. Without our current level of surplus, we would not be able to borrow on such favourable terms and this would result in fewer new affordable homes being built and a higher proportion of our rental income being used to pay interest rather than provide improved services. 

Based on your feedback from surveys and complaints we want to invest rental income to continually improve services and your neighbourhoods. This includes:

  • the standard of properties when they are let
  • the quality of repairs
  • maintenance of our common areas
  • our estate management service which is under pressure due to continuing council service reductions
  • improvements in our neighbourhoods and developing opportunities for customers
  • increasing the level of support to customers facing challenging financial circumstances.

The level of rental income has an effect on how quickly we are able to improve this services. We have controlled our costs and made efficiency savings in order to minimise the impact on customers and we will continue to balance the requirements of the business with the affordability of rents for customers. You can find out more on how we use the money from your rent here

Affordability 

Keeping our rents affordable to you us a priority for us. Our affordability checks clearly showed that our rents on one bedroom properties were in danger of being unaffordable to a higher percentage of customers than rents in larger properties, In 2013 we started to increase the rent gap between our smaller and larger properties.

The Scottish Social Housing Charter states that "a balance is struck between the level of services provided, the cost of the services and how far current and prospective tenants and other customers can afford them". This is what our proposed rent increase attempts to do.

Consultation 

We will consult you on rents, affordability and service levels in June 2017 which will influence our proposals for rents from 2018/19 to 2020/21. We will repeat this on a three year cycle.

We will also seek feedback from you on rents and affordability annually in our customer satisfaction survey.

If you would like to be part of our consultation exercise in June 2017, please send your details to customer@castlerockedinvar.co.uk.

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